TG Therapeutics' CEO Discusses Q4 2013 Results - Earnings Call Transcript

| About: TG Therapeutics, (TGTX)

TG Therapeutics, Inc. (NASDAQ:TGTX)

Q4 2013 Earnings Conference Call

March 06, 2014 08:30 AM ET


Jenna Bosco – Director-Investor Relations

Sean A. Power – Chief Financial Officer

Michael S. Weiss – Executive Chairman, Interim President and Chief Executive Officer


Jonathan Aschoff – Brean Capital LLC

Matthew L. Kaplan – Ladenburg Thalmann & Co., Inc.

Joe Pantginis – ROTH Capital Partners LLC

Graig Suvannavejh – MLV & Co. LLC


Greetings and welcome to the TG Therapeutics Fourth Quarter and Year End 2013 Financial Results and Business Update Call. At this time all participants are in a listen-only mode. A brief question-and-answer session will follow the formal presentation. (Operator Instructions) As a reminder this conference is being recorded.

It is now my pleasure to introduce your host Ms. Jenna Bosco, Director of Investor Relations for TG Therapeutics. Thank you, Ms. Bosco. You may begin.

Jenna Bosco

Thank you. Good morning and welcome to our conference call, regarding TG Therapeutics fourth quarter 2013 financial results and business update. I am Jenna Bosco, TG’s Director of Investor Relations and I welcome you to our conference call today.

Following our Safe Harbor statements, Sean Power, TG’s Chief Financial Officer, will provide a brief overview of our financial results and then turn the call over to Michael Weiss, the Company’s Executive Chairman and Interim Chief Executive Officer, who will provide an update on the ongoing development of our novel glycoengineered anti-CD20 monoclonal antibody, TG-1101 and our novel once daily PI3K delta inhibitor, TGR-1202.

Before we begin, I would like to remind everyone that various remarks that we make about our future expectations, plans and prospects constitute forward-looking statements for the purpose of the Safe Harbor provisions under the Private Securities Litigation Reform Act of 1995. TG cautions that these forward-looking statements are subject to certain risks and uncertainties that may cause our actual results to differ materially from those indicated. Factors that may affect TG Therapeutics’ operations include various risk factors and uncertainties that can be found in our SEC filings.

This conference call is being recorded for audio rebroadcast on TG’s website,, where it will be available for the next 30 days. All participants on this call will be on listen-only mode.

Now, I would like to turn the call over to Sean Power, our Chief Financial Officer to briefly discuss the financial results for the fourth quarter of 2013 as well as the Company’s overall financial condition.

Sean A. Power

Thank you, Jenna and thanks everyone for joining us. As you may be aware, our financial results were released yesterday evening and can be viewed on the Investors and Media section of our website at

As of December 31, 2013, the Company had cash, cash equivalents, investment securities and interest receivable of $45.4 million, as compared to $16.5 million at December 31, 2012.

Turning to the financial results for the quarter. The consolidated net loss for the fourth quarter ended December 31, 2013 was $5.7 million, or $0.19 per diluted share, compared to a consolidated net loss of $3.5 million during the comparable quarter in 2012, representing an increase in consolidated net loss of $2.2 million. The consolidated net loss for the fourth quarter ended December 31, 2013 included an increase in other research and development expenses of $2.7 million, principally related to the TG-1101 and TGR-1202 clinical development programs and drug supply costs.

Also, included in the consolidated net loss for the fourth quarter ended December 31, 2013 are the following non-cash items: $2.8 million for the impairment of in-process research and development expenses; and $0.9 million of non-cash compensation expense related to equity incentive grants; partially offset by non-cash income of $2.4 million related to the change in fair value of notes payable.

The consolidated net loss for the year ended December 31, 2013 was $20.5 million, or $0.81 per diluted share, compared to a consolidated net loss of $26.2 million for the year ended December 31, 2012, representing a decrease in consolidated net loss of $5.7 million. Included in the consolidated net loss for the year ended December 31, 2012 was $16.6 million in non-cash stock expense recorded in conjunction with the license for TG-1101, which is partially offset by an increase in other research and development expenses in 2013 of $8.6 million principally related to the TG-1101 and TGR-1202 clinical development programs and drug supply costs.

Also, included in the consolidated net loss for the year ended December 31, 2013 are the following non-cash items: $2.8 million for the impairment of in-process research and development expenses; and $5.2 million of non-cash compensation expense related to equity incentive grants, both of which are partially offset by non-cash income of $3.3 million related to the change in fair value of notes payable.

I will now turn the call over to Mike Weiss, our Executive Chairman and Interim CEO.

Michael S. Weiss

Thank you, Sean, and thanks to all of you for joining us on this call today. 2013 was an extremely productive and exciting year for us at TG. In less than two years since inception we’ve been able to build an aggressively developed and impressive pipeline, driving us closer to your ultimate goal of developing novel, next-generation, non-chemotherapy based combination treatment for B cell malignancies.

Some specific achievements for 2013, I would like to highlight are for 1101, our novel glycoengineered anti-CD20 monoclonal antibody. We’ve presented preliminary data from our first U.S. dose escalation trial of 1101 as a single agent at ASCO and at the European Hematology Association meetings, both occurring in the middle of the year. Around the same time we presented via an oral presentation preclinical data demonstrating the synergy of 1101 plus 1202 at the International Conference on Malignant Lymphoma in Lugano.

Later in the year we completed enrollment in the 1101 single-agent study, including expansion cohorts, the final enrollment of approximately 30 patients with the expectation that final data from that study will be presented sometime in the middle of this year.

And finally, at the end of the year, we commenced combination trials of 1101 plus ibrutinib and 1101 plus 1202, launching our most anticipated combination program. And for 1202, our novel once daily PI3K delta inhibitor, we made significant progress in our first-in-human Phase 1 dose escalation trial and although we have not yet hit a maximum tolerated dose or an MTD, we have reached therapeutic dose levels. As a result, we opened and nearly completed enrollment into our first expansion cohort at 800 milligrams and plan to shortly launch a 1200 milligram an additional expansion cohort.

As discussed earlier, we also opened the 1101 plus 1202 combination study and at the end of the year, at the 2013 American Society of Hematology Meeting, referred to as ASH, we presented preliminary results from this Phase 1 study. In addition to the clinical results multiple preclinical abstracts were also presented, the TGR-1202 in combination with novel agents.

For those of you who are interested in the Company, we would encourage you to review the full ASH posters available on our website under the Publications heading in the Pipeline section.

In addition to the clinical updates, during the course of the year we were very excited to gain our NASDAQ listing in the second quarter of 2013 followed up by an equity financing of approximately $40 million in July, which included top healthcare specific investment funds.

Now, I’d like to provide a further update on our clinical programs. I’ll start with 1202 as I’d like to first summarize the exciting data, which was recently presented at the 2013 ASH meeting. As you may recall, in September of 2013, we shared the first PK data demonstrating that 1202 can be dosed once per day as opposed to twice daily with other PI3K delta inhibitors.

At the ASH meeting, the PK data was further confirmed and in addition, we present a data on 23 patients evaluated at multiple dose cohorts with single-agent 1202. The study was designed to start at very low doses 50 milligrams QDs of once per day and we double the dose up through 800 milligrams followed by 1200 milligrams and now we are dosing at 1800 milligrams. As of the date of the presentation in December, safety data was available on all patients through the 1200 milligram cohort, while efficacy data was available on all patients through 800 milligrams.

From a safety standpoint, 1202 has been generally well tolerated through the 1200 milligram dose group with only one DLT observed at the 800 milligram dose level and all adverse events considered to manageable by the investigators. Importantly, no liver abnormalities including increases in ALT or AST have been observed. As many of you are aware, these liver lead abnormalities are the primary cause for dose interruptions for other PI3K delta inhibitors in development.

On the efficacy side, we are pleased to observe a dose response relationship with patients treated with 1202 at the higher doses, 400 milligrams QD or greater, demonstrating marked reduction in tumor burden. In particular of the five cell locations treated at the 800 milligram cohort, one patient was released off from the study due to a Richter's transformation. However of the remaining four patients, three achieved nodal responses at the first assessment. Additionally, although not a true nodal partial response the fourth patient achieved a significant nodal reduction of greater than 40%, also at the first scan.

I’m excited to report that we’ve now treated over 30 patients with 1202. We still have yet to observe any liver lead abnormalities related to 1202, with some patients now approaching 12 months of treatment.

We continue to be impressed with the activity, safety and PK profile of 1202 and look forward to providing additional updates from the study throughout 2014. This multi-center study has been lead by Dr. Skip Burris of The Sarah Cannon Research Institute. Dose escalation is on going now at 1800 milligrams QD, in addition to opening enrolling select expansion cohorts at 800 and 1200 milligrams to further confirm safety and efficacy.

As we’ve mentioned in the past, one of the goals of our Phase 1 dose escalation program was to achieve blood concentration levels of 1202 in excess of dose achieved by idelalisib, the leading PI3K delta inhibitor. Our thesis has been that we might be able to try the improved activity, if we can safely deliver higher concentrations of 1202 and idelalisib was able to achieve due to a combination of toxicity as well as a flattening of the dose exposure relationship above 150 milligrams POD of idelalisib.

We found that approximately 800 to 1200 milligrams of 1202, we are now in excess of idelalisib drug exposure level. While we continue to push higher with dosing as noted earlier, we are also exploring ways to improve drug exposure at lower doses. We expect to be able to update on that work also as part of our next scientific presentation.

I’d like to now spend a few moments updating the status of the 1101 clinical program, and the exciting highlights from the developments to-date. As previously shared 1101 is a novel glycoengineered anti-CD20 monoclonal antibody, in that way it’s similar to GA-101, now called Gazyva, developed by Roche and Genentech, which recently demonstrated in a randomized controlled clinical trial superiority to Rituxan in the treatment of patients with CLL.

We believe the increased efficacy of the GA-101 over Rituxan in the pivotal trial is a strong validation that you can improve the performance of anti-CD20 monoclonal antibodies through glycoengineering. We believe 1101 is the only other glycoengineered anti-CD20 monoclonal antibody in clinical development.

At ASCO this year in 2013, we confirmed the safety and activity of 1101 in patients with B-Cell Lymphoma. 1101 demonstrated a manageable safety profile with limited Grade 3 or 4 events as well as approximately 50% overall response rate in the dose escalation cohorts. As a result we began additional dosing cohorts to better understand the safety and tolerability of different dose levels and schedules of not completed enrollment into all expansion cohorts.

This multi-center simulated study was led by Dr. Owen O’Connor, Director for the Center for Lymphoid Malignancies at Columbia Medical Center. Results from this study are expected to be presented at a major medical meeting in the middle of 2014. With the single-agent study of 1101 complete, we’ve rapidly turned our attention to novel combinations.

As most of you are aware, the data combining anti-CD20 monoclonal antibodies plus small molecule B-Cell receptor inhibitors like BTK and PI3K delta inhibitor has been quite impressive. We are excited to be able to push that research to the next level as the first company ever to combine a glycoengineered CD20 with a B-Cell receptor inhibitor.

In the fourth quarter of 2013, we launched combination studies of 1101 plus ibrutinib as well as 1101 plus 1202, our proprietary combination therapy. The first, a Phase 2 study with a safety and run-in period evaluating 1101 plus ibrutinib is now finishing up the first cohort for both the Mantle Cell Lymphoma group and the Chronic Lymphocytic Leukemia group. We are grateful to the support from Dr. Jeff Sharman, Medical Director for Hematology and Research at US Oncology, who is leading the CLL enrollment group and to Dr. Owen O’Connor who is leading the Mantle Cell patient cohort.

The second study, being led by MD Anderson Cancer Center is our first clinical trial evaluating the combination of 1101 and 1202, which Dr. Susan O’Brien, Professor in the Department of Leukemia is a Study Chair for the CLL patient group. And, Dr. Nathan Fowler, Co-Director of Clinical Research in the Department of Lymphoma is a Study Chair for the Non-Hodgkin's Lymphoma patient group. We look forward to presenting clinical update on both studies at major medical meetings throughout 2014.

With that, let me reiterate our highest priority is rapidly enrolling our ongoing combination clinical trials and commenting additional combination trials for 1101 and for 1202 to fully explore the potential benefits to patient of the novel agents. 2013 was an extremely productive and rewarding year for TG Therapeutics. And we expect 2014 to be even more exciting. 2014 should prove to be transformational for the Company as we clarify our clinical and regulatory strategies for both 1101 and 1202.

Specifically, our goals for 2014 include completion of the 1101 combination trials with ibrutinib and with 1202. We like to present updated single-agent data for both 1101 and 1202 as well as data from ongoing and future combination studies at major medical meetings throughout 2014. And most importantly, all these trials should support the launch of our first Phase 3 registration trial for at least one of our pipeline drug candidates.

In addition to 1101 and 1202, we continue to evaluate other opportunities, whether additional drug candidates or partnerships, which we believe will enhance our strategic direction and ultimately create shareholder value. We are excited to be working with leading hematologic cancer experts throughout the world on the development of both compounds and we look forward to future clinical updates throughout the year.

With that, I’d like to turn the call back over to the conference operator for the Q&A session, following which I will return and provide some concluding remarks.

Question-and-Answer Session


Thank you. (Operator Instructions) Our first question is from Jonathan Aschoff of Brean Capital. Please go ahead.

Jonathan Aschoff – Brean Capital LLC

Thanks a lot. I have a couple of questions. I asked a couple of times by some clients about 1202 potency, just given the relatively high doses in which you’re seeing pretty solid efficacy. And if I recall correctly, didn’t Clovis have an oral bioavailability issue that they were able to subsequently formulate around and I was wondering if any such reformulation efforts are going on at the TG.

Michael S. Weiss

Hey, Jonathan. Thanks. So, yes we internally don’t think there is anything related to potency with our compound. When we look at giving the drug at certain levels of milligrams what’s on the other side is an exposure level in the serum and clearly we were having low bio oral availability, very similar to, I guess what Clovis has been seeing. We have several programs underway, looking at ways to improve the oral bioavailability so that we can bring down the actual milligram dosage utilized to get the similar or even better exposure.

We haven’t been specific about. We’ve mentioned in a few times and a few different settings, but we think that by middle of the year for sure we should be able to talk about what we’re looking at in terms of savings, I’d say, in terms of where we’ll take the dosing from where we are. Right now I guess we’re about 1,800 milligram in the dose escalation trial. We think we’ll certainly be able to get similar exposure to those levels at lower, potentially much lower levels although that’s the FTC. So we’re working on it. We’re not doing anything material and major that will require new clinical trials or anything like that.

We think we have some very subtle changes that can make actually a very big impact. So I think going forward we may end up with milligram quantities that are somewhat similar at least to achieve blood concentrations similar like idelalisib. We’re predicting that we’ll be pretty close to similar milligram quantities that they’re using, but again think we’re going to have the bit fortune to be able to push the dose. We won’t know how much higher, but we think will be higher and we’ll be able to get higher concentrations in idelalisib.

Jonathan Aschoff – Brean Capital LLC

Okay. And just two more. Can you give some color what you think is your best dose at present? And the other part of that question was, how fit or flexible – I’m kind of forgetting is the dosing in the 1101 plus 1202, how exploratory or fixed is that?

Michael S. Weiss

Yes, so we’re in a very tight range at this moment. In non-Hodgkin’s lymphoma we safely dosed up to 1,200 milligrams, but we think for convenience sake we’re probably going to settle in at 900 milligrams.

With CLL, we’ve dosed now at 600 and 900 both safely. To be conservative, we started the combination with 1202 on the CLL side at 600, but it’s just one step up back to 900 and so we think there’s going to be basically one standard dose for both. NHL and CLL looks to be the 900 milligram dose of 1101.

With respect to 1202 in those studies, the plan is to basically dose escalate 1202 as we safely learn more about higher doses on the dose escalation of 1202. So we’ll have a fixed 1101. Again one step up from 600 to 900 on the CLL side. That will be done soon. As soon as we get through that, we’ll continue with dose escalation of the 1202, again as we learn more from that dose escalation trial.

Jonathan Aschoff – Brean Capital LLC

Thanks a lot, Mike.

Michael S. Weiss

Thank you, Jonathan.


Thank you. The next question is from Matt Kaplan of Ladenburg Thalmann. Please go ahead.

Matthew L. Kaplan – Ladenburg Thalmann & Co., Inc.

Hi, good morning, guys.

Michael S. Weiss

Good morning, Matt.

Matthew L. Kaplan – Ladenburg Thalmann & Co., Inc.

First, I guess little bit of a housekeeping question. In terms of guidance, your clinical development activities may have been up this year, potentially starting, as you said, Phase 1 study. Do you think it’s best in terms of R&D spend that you’ve backed in 2014?

Michael S. Weiss

Yes, and I think across 2014 the burn should remain reasonably stable. I mean, we’ve been typically in the 4 to 5-ish range of guidance per quarter. My guess is we’ll probably run close to 5 during the course of 2014 even as we ramp up and get involved potentially in some registration trials towards the end of the year. Again, unfortunately you just can’t spend enough money early on those trials. Recruitment ramps up in somewhat of a hockey stick format usually. Then we can’t predict exactly the start time to stay high, but most clinical trials that I have ever been involved in start off pretty modestly. So at the beginning I don’t think we could spend the money as fast as we’d like them through the end of 2014. So I think practically speaking we’ll be concerning to that 5-ish per quarter number through 2014.

And, again, as we get into 2015, we’ll evaluate – we’re going to do a lot more. We’re going to be at one, two, six, who knows how many registration trials. Certainly we’re modeling for at least one and with one registration trial even through 2015. Again, when you take away a lot of these other background studies that we’re running, the burn rate for one pivotal trial wouldn’t really change our burn rate through much of 2015 as well. And so that would get us comfortably through 2015 also.

Again, it really does stand on how many opportunities we see as we go through this year and how we want to develop the drug, but we see a pretty stable burn rate with a baseline case of, say, one registration trial starting at the end of the year and going through 2015.

Matthew L. Kaplan – Ladenburg Thalmann & Co., Inc.

Okay, great. Thanks for the detail. One question I get frequently is, so let’s say, the phase in terms of B-Cell, going to phase has a kind of a little bit crowded, to speak, in terms of the therapies that are in development or available now, and can you talk about how 1101 and 1202 potentially differentiate and why the relative playing the market in future?

Michael S. Weiss

Sure. So, one thing that’s important to note is when you think about 1101, it really stands in a class that’s very small, I mean we look into those two really glycoengineered anti-CD20s. Our view today is based on data received from Xylem [ph] and data received from our drug is that these drugs are differentiated and should perform better than Rituxan, particular in CLL and probably carries forward into most applications in NHL, although, again yet to be determined.

We you think about the next level of studies, we’re talking about not just taking CD20 plus cells or ibrutinib, but we’ve actually gone to the next level. We now feel like we are the standard. We are the only one who have been able to combine and exam glycoengineered CD20 with a PI3K delta, which in this case is also 1202 and with ibrutinib.

So in terms of differentiating, we’ve always said it’s going to be combinations, but obviously combinations of potentially best-in-class molecules and being the first two best-in-class combinations, we think in and of itself, a differentiator. Going forward, again, it’s going to be a function of clinical and regulatory development.

I think for the most part, if you look at the series of Phase 3 trials that underway or have been telegraphed as planned by some of the other companies that are developing drugs in this area, we have a pretty good picture and it’s not as vast as people might think, pretty good picture of where the next approvals are going to occur and they’re not going to occur for two, three or four years, right. So we’ve got this first class of compounds, got ibrutinib now approved from Mantle Cell and CLL and possibly they’ll have long terms approval earlier. The next set of approvals is going to be idelalisib in indolent lymphomas and probably in CLL and combination with Rituxan.

And then, really from there you’re looking at Infinity who has two and they have talked about a third registration program. But the field is kind of delineated and we got a pretty good sense of where things will look like, what things will look like in a three-year timeframe and that’s a good place for us to be. We’ve got two active compounds. We think a really nice combination with the first-in and best-in-class of these agents and we get to select around what everyone else is doing.

So I think when we come to the end of this year, whether it’s one, two or three or whatever the number of registration trials, I think that is ultimately how things are going to differentiated. At least in the next three to five years, it’s going to be what your label looks like, how you get approved and what’s your label long-term as you get – we and others will get companion listings for our agents and multiple indications. It’s going to get a little bit dispersed and spread out and then it’s going to be a function of tolerability activity price. And we think that just lining up our compounds today, we think activity and safety and tolerability look quite good.

And then, we do have an advantage over just about everyone else other than possibly Roche with their combinations that they’re going to be working on that everyone else is not going to have the kind of price competitive positioning that we have.

So, I mean short-term we’re leaders in driving the glycoengineered CD20 to the next level in combination with PI3K delta’s and BTK inhibitors. In the mid-term it’s going to be a function of what clinical and regulatory strategy that we choose that will become apparent to investors towards the end of this year. And then longer term, it’s going to be a function of overall where does everything fit in, in terms of safety, tolerability, efficacy and cost, we think short, mid and long-term we’re well positioned.

Matthew L. Kaplan – Ladenburg Thalmann & Co., Inc.

Great, thanks. And then just one type question. Couple of things I heard during the call is [indiscernible] never won against your confidence in terms of watching regulatory studies later this year. That’s kind of a first and can you comment on why are you confident that you’ll be able to do these later this year, and I guess based on the activity and safety profile that you’re seeing on ongoing studies. And then secondly, with that question is the lack of liver toxicity that you’re seeing are a signal that you’re seeing with 1202 up to 1200 or 1800 milligrams. Can you give us a little bit of a sense of how that compares to the other deltas after that…

Michael S. Weiss

Yes, so the on liver lead abnormalities it’s a tough one. The other deltas particularly, I don’t list it, it’s 145. When they see liver tox, it’s reasonably early onset. It’s typically, I would say, anywhere from two to eight weeks. You would see liver lead abnormalities. In some cases it’s obviously in the week three or four range, which gets kind of scary. You do run the risk of liver failure at that point., patients are taken off the drug. They go on a holiday.

Most patients, I think, are able to reinitiate treatment, but again its toxicity and it’s an issue that I think people would rather not have to deal with. And particularly once you start thinking about multi drug combinations it just adds another level of complexity when you look at these together.

So, that did we have not seen it yet. We are certainly at therapeutic dose levels. Actually we have not seen it. It all gives us some reasonable level of confidence that we have done a good job in engineering around it, but I don’t think we could definitively say we are devoid of liver tox at this point, but I’d say we’re feeling pretty good about that part of our projected product profile, when we started the program. Again, we need to achieve more patients and potentially even at higher doses and we’ll see what happens there, but we’re feeling pretty good about it.

And then again, all of these drugs need to be taken in the context. When I talked earlier about safety and tolerability, I could have easily added new price subjects that would be combinability, right, which is none of these drugs are going to on a simulative basis be the answer for the treatment of CLL or NHL. These are all building blocks toward a goal of getting the highest number of patients to a CR or MRD negativity with the lowest toxicity.

It almost doesn’t matter how many compounds are necessary. It’s really a function of, can you get there with the lowest amount of toxicity. And so, when you are combining these agents you really want to be balanced. Activity is great, but you really want to have the tolerability profile and whether it’s liver lead abnormalities that cause dose interruptions, never a good thing. Whether it’s GI tox, also problematic and also could be compounding with other small molecules. So you want to watch out for that kind of stuff.

And, of course, neutropenia is another factor you want to be looking out for particular again the thing about combining with any of these agents you will get some level of neutropenia when you combine with CD20s and we expect CD20s will continue to be the backbone, so anything that has an elevation of neutropenia since there was going to be a concern to us when we are doing these combinations.

Matthew L. Kaplan – Ladenburg Thalmann & Co., Inc.

All right, thanks. Back from the progress and last year we are looking forward to the initial readout of the complex studies later this year.

Michael S. Weiss

Thanks Matt, we appreciate it.


Thank you. The next question is from Joe Pantginis of ROTH Capital Partners. Please go ahead.

Joe Pantginis – ROTH Capital Partners LLC

Hey, guys good morning, thanks for taking the question. Couple of question, first, when you are looking at CD20 landscape now. How would you look to interpret at this point? Do you [indiscernible] had on your program and tracking more intermediate just or anything from a potential continued aspect how would you describe its impact …

Michael S. Weiss

For us, I don’t know if it’s had any particularly positive or negative, I think perception wise, it certainly helped us. I think people get what the differences now between Gazyva Rituxan and ideally between plus Rituxan. It’s nice to talk in theory about a class of drug i.e. glycoengineered CD20s and say that, we think they are going to be better than Rituxan, and then to have one of the class members and there is only two members of the class, one of the class members actually demonstrate itself to be better and in randomized control trial.

So we think that the physician community that we’ve been interacting with there is a clear change in mindset that yes, you know what? Gazyva’s glycoengineering it matters, it does change the profile for these drugs. It does add to the potency of these drugs, and so I think that’s helped us, and again I think over time as Roche Genentech, who we think are obviously super smart people get out there and tell the story and convince people that the glycoengineering CD20 is better than what they are using currently with Rituxan. That’s a great opportunity for us, that’s where people can be okay.

Now we know that there is something better out there. What else is out there looks or acts like that, and we are only the other guys around, so we think that the community is certainly down on board. So I think that’s part of the biggest overall change in terms of competition, again we never viewed this space as a winner take all zero-sum game, we’ve always been of the position that it’s about the novel combination, it’s not about any individual component in a combination, but the more you could push better and more tolerable agents into those combinations, the better off you can be, and there is plenty of room across CLL and NHL to share, and more importantly it help patients in multiple lines of therapy.

So we think that being the only other glycoengineered CD20 puts us in a great position, and whether Roche is the dominating first line player, we think as we move into second, third line, and again we’ve always been focused on those later lines, we can actually provide a real valuable product to patients to help improve their survival.

Joe Pantginis – ROTH Capital Partners LLC

That’s great, thank you. And then with regard to the 1101 and ibrutinib combination study, what would say will be your base case expectation toward the study in order to consider in success give something beyond the data and safety in combination?

Michael S. Weiss

Yes, so if you look at around the largest studies that have been done, I don’t know if there is a large one with ibrutinib and CD20. But certainly there has been a large study of idelalisib for CD20 Rituxan in that case. And that team in about 85% with long-term follow-up.

We are looking at is certainly early on we are going to have maybe two months or four months of data, the response rate for ibrutinib on its own, it’s pretty low at the two month and four month check points. So we are not 100% sure of what to expect at two and four months. We certainly know that as you get to by six or nine months, we will feel comfortable that we should be at peak response for the combination.

Peak response ideally would be 90% north. I think we’d be certainly happy again in smaller numbers you can easily end up at 85% north. But as the numbers get larger and larger, our hope would be that we are driving closer to 90%. And then, obviously following that forward new, we soon will like to see even better than that, particularly combinations in CLL, when we look at the ultimate response rate for ibrutinib is a balance of 70% with about another 20% in the nodal responses without clearance of lymphocytosis.

So again in base case, we take their 70 plus our 20, we should be pretty close to 90%, since we are pretty close to 100% in clearing the lymphocytosis. In case we are 100%, but pretty darn close to 100% in clearing the lymphocytosis. That doesn’t account for any potential synergies between the two agents. It doesn’t account for the fact that we are seeing on a standalone basis for our drug, even near or close to about 50% response rate in CLL, relapsed refractory patients.

So, we think we’ve got a pretty strong rationale to push higher and higher and ideally push higher the CR rates. The CR rates for single-agent ibrutinib were quite low, I think it was 4% or 5%. If that high, the CR rates of idelalisib plus Rituxan were also quite low. I think and maybe in the 10% to 12% range. I have to double check that number, but I remember it was quite low. So, we think there is room to improve the overall response rate. We think there is certainly room to improve the CR rates. And so, we are – that is kind of where what we are thinking about.

Joe Pantginis – ROTH Capital Partners LLC

Yes, it’s real great, thank you. And then, my last question is with regard to 1202 in the average this year regarding, and I guess we call it reformulation or how you describe it was, as you are looking to change [indiscernible] structured combination error. Do you have the potential for move your – once for daily dosing or is that factor in?

Michael S. Weiss

Joe, can you ask that question again please?

Joe Pantginis – ROTH Capital Partners LLC

Sure, sure. I think based on your reformulation effort for 1202, you’ve the potential to produce your once per day dosing uncharacteristic of the drug.

Michael S. Weiss

Absolutely not. Yes, now what we were talking about in terms of reformulation is very, very basic kinds of things. We haven’t even thought about doing anything complicated. We think we can actually bring down the dose pretty dramatically. I mean and I say, we think that we can get two about the concentration level of idelalisib with about the same milligram dosage, through very modest modifications. Again, I won’t say it’s – can be exactly overlapping at that point, but much closer than where we are today and that doesn’t require any sophisticated formulation efforts.

So nothing will impact the once a day status. It won’t change, since anything on liver tox, I mean there is nothing complicated about what we’re doing, really simple straightforward stuff. And so, yes, once a day is, we think, pretty well locked up and the half life at steady state is almost incalculable at this point, but somewhere between 1500 hours is the best estimates we have.

Joe Pantginis – ROTH Capital Partners LLC

Okay, great. Thanks, a lot Mike.

Michael S. Weiss

Thanks. Joe, just one last point. So let me just – my correct research desk is on the case and apparently in the Rituxan idelalisib pivotal trial. There were no CRs. So I’ve really on its own had about 3% to 4% and Rituxan plus idelalisib had no CRs in the CLL pivotal trial.

Joe Pantginis – ROTH Capital Partners LLC

Got it. Thanks again.


Thank you. The next question is from Graig Suvannavejh with MLV. Please go ahead.

Graig Suvannavejh – MLV & Co. LLC

Thank you. Good morning, guys and let me add my congratulations on a really nice 2013. Couple of questions if I may. What are your current thoughts on the next combination trials? I think in the past you’ve talked about a combination 1101 plus idelalisib and so while the focus remains on the current combination, just if you could help us think about how you are thinking about the next trials going forward?

Michael S. Weiss

Yes. So we haven’t disclosed anything further. I could say that we’re probably internally deemphasizing the idea of working with idelalisib. At this time we have, I’d say, a few other novel combinations that we’re thinking about and planning, and do some serious exploration on, and I think as we announced those trials, we will obviously talk about and I think given the competitive landscape and given we’ve identified some interesting greenfields of opportunity that folks have just decided not to outsource just or not seeing, we’ve decided not to disclose any of those sort of strategy. So I think for the moment we’re keeping investor focused on 1101 plus ibrutinib and 1101 plus 1202. And potentially in the coming months we’ll announce some additional combination trials.

Graig Suvannavejh – MLV & Co. LLC

Okay. Thank you. More specifically as it relates to upcoming medical meetings being EHA and ASCO, what kind of data should we investors be expecting you guys to maybe share?

Michael S. Weiss

Yes. So the goal would be to present the final Phase 1 data from the single-agent 1101. We’d like to present an update, the 1202 study. So whatever data we have again are still dose escalating, we’re running some expansion cohorts. So whatever data is available we would like to share that data around that time. We have the combination studies running. So 1101 plus ibrutinib and 1101 plus 1202 and I still think our goal is to have patient data on somewhere between five and 10 patients for each of those studies available for those conferences around mid-year.

Graig Suvannavejh – MLV & Co. LLC

Okay. Thank you for that. And meanwhile other questions will be – and Michael you’ve done a really nice job, building value and the company as well building value for shareholders and it’s just now for some reasons struck me that you have a tag of Interim CEO. And so, I’m wondering if you could share with us what your or what the Company’s or what the Board’s thought is on a more permanent CEO person whether to you or someone else?

Michael S. Weiss

Yes. I think for the moment, we actually recently had this conversation with the Board and I have no intention of advocating my position anytime soon and I think my goal has always been to make sure I see TG to a secure place in terms of development and where we are strategically. And at that point I would make a decision of what makes most sense. I think that’s still a year or more away in terms of giving that a hard look. So I think that you could feel very secure for better or worse if I stopped me consistently over 12 months and then we’ll just reevaluate at that point, but I think we’ll get for 12 more months for sure.

Graig Suvannavejh – MLV & Co. LLC

Okay, great. Thanks for taking my questions. And, again, congratulation on a great 2013 and also look forward to another great 2014.

Michael S. Weiss

Great. Thanks, Graig.


Thank you. We have no further questions in the queue at this time. I’d like to turn the floor back over to Mr. Weiss for any closing remarks.

Michael S. Weiss

Thank you. So let me just conclude then by thanking all of my investigators and their patients and as well as all our shareholders and investors for their continued support. We look forward to most exciting 2014, in which we plan to aggressively accelerate both of our programs towards and ideally into Phase 3 development. Thanks again for joining us and have a great day.


Thank you. Ladies and gentlemen, this does conclude today’s teleconference. You may disconnect your lines at this time and thank you for your participation.

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